Hospital Emergency Room Use in Medicaid: What We Know

High hospital emergency room use by Medicaid enrollees is a perennial concern. What do we know about Medicaid emergency department visits? Are they medically necessary? What drives Medicaid emergency department visits? Is Medicaid ER utilization increasing under the Affordable Care Act?

While use of the emergency department (ED) by Medicaid enrollees accounts for only 4 percent of total Medicaid spending, Medicaid enrollees use hospital emergency rooms more often than uninsured and privately insured patients. Due to the high cost of treatment in the ED, the emphasis from state Medicaid agencies and Medicaid health plans has always been to mitigate this by educating patients about the proper use of the ED, in addition to providing expeditious access to primary and non-urgent care in other settings, ideally patient-centered medical homes.

MACPAC found that increased use of the ED by Medicaid enrollees is due to the higher rates and severity of chronic disease and disability that enrollees experience in comparison to those who are uninsured and privately insured. Another presumed reason for the high use of the ED could be lack of access to primary, specialty, dental, and outpatient mental health care in other settings.

Evidence on Medicaid Use of Emergency Departments:

Here is a summary of MACPAC’s assessment of common beliefs about Medicaid emergency room utilization:

Belief: Much of the ED use among Medicaid enrollees is unnecessary. Fact Check: False. Non-urgent visits by non-elderly Medicaid patients account for only 10 percent of all Medicaid-covered visits, MACPAC found. Most ED visits by Medicaid enrollees under age 65 are actually for urgent and serious medical problems.

Belief: Medicaid patients’ ED use is increasing. Fact Check: Not clear. This particular point raises conflicting evidence, because the data for estimating trends by payor is a “problematic source,” due to the changes in the survey’s payor coding and other limitations of the payment variable, according to MACPAC.

Belief: Medicaid patients use hospital emergency department services more frequently because they have difficulty getting in to see their regular physician. Fact Check: True. Nearly all Medicaid patients report having a usual place of care, apart from the ED, but about one-third of adults and 13 percent of child enrollees have reported barriers to finding a doctor, or delays in getting needed care, resulting in higher ED use.

Belief: Frequent ED use could be avoided if those users had greater access to primary care. Fact Check: Partially true. The category of frequent users includes a wide array of individuals with “diverse and complex needs,” but mostly consist of the severely disabled or those in fair-to-poor health, MACPAC found. Frequent use of the ED is a result of a combination of psychological and medical needs that cannot be addressed only through primary care. Evidence points to weaker ties to regular physicians among Medicaid enrollees with 10 or more ED visits a year, and at least half of this number did not receive any outpatient care of any kind in the 30 days after their discharge from the ED.

Belief: Use of the ED will surge as Medicaid enrollment continues to significantly expand under the Affordable Care Act and waiver-based expansions. Fact Check: Insufficient evidence; too early to say. MACPAC found that a review of existing studies on previous Medicaid expansions suggests that the effects of coverage expansion could vary across states, with some experiencing no increase in ED use and others experiencing short-lived but significant spikes in usage.

Factors Fueling Emergency Department Use in Medicaid:

ED use may be the outcome of several factors, including a perception by the patient and their medical provider of the need for prompt care, which may be based on the severity of the condition, the accessibility and availability of both the ED and alternative sites, and physician referrals to the ED. A variety of other factors, such as drug-seeking behavior, higher rates of behavioral health and physical health co-morbidities, and social-economic issues, particularly low education, also likely fuel higher emergency room use among Medicaid enrollees. Low Medicaid physician reimbursement and reluctance of some physicians to take on more Medicaid patients may further drive enrollees to emergency departments.

Reducing ED Use by Medicaid Enrollees:

MACPAC notes that many state Medicaid programs have taken steps to reduce the use of the ED through approaches that include the diversion of patients with complaints determined to be non-urgent to lower-cost settings, and the charging of co-payments for non-emergency ED use. Another deterrent to ED use is the focusing of efforts on super-utilizers. In many cases, a relatively tiny number of Medicaid enrollees use emergency rooms with staggering frequency – some virtually on a daily basis – driving up and skewing overall utilization figures. It is important to note that Medicaid managed care programs are often more effective than Medicaid fee-for-service care delivery in reducing non-urgent use of emergency departments. To read MACPAC’s 14-page issue brief, click here (PDF).

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The Piper Report blog on healthcare business and policy covers issues in Medicaid, Medicare, and the Affordable Care Act, with articles, interviews, resources, primers, book reviews, and more. Edited by Kip Piper, CEO of Medonomics.